WASHINGTON, DC – Today, the Office-Based Facility Association (OBFA) Executive Committee issued the following statement in response to the text of the Budget Reconciliation legislation released by the House Energy and Commerce Committee:

“We view Physician Fee Schedule (PFS) provisions contained in the House Budget Reconciliation package as a downpayment towards additional, critically needed relief for office-based providers throughout the remainder of the 119th Congress."

“On the positive side, an estimated, permanent 1.7% increase in the 2026 conversion factor is welcome news. (1) On the other hand, such an increase still would not undo the entirety of the conversion factor cut from 2024 and still represents an 8% cumulative conversion factor cut from 2020 to 2026. Moreover, in the outyears, an increase to the conversion factor of just 10% of the Medicare Economic Index (i.e. medical inflation) is inadequate, by definition.”

“In addition, these provisions continue to ignore the urgent need to address PFS practice expense shortfalls that are contributing to the closures of office-based proceduralists, particularly in rural and underserved areas. As a result of ongoing PFS practice expense cuts, independent providers are often paid much less than their costs. This dynamic drives health system consolidation and is why more than 300 PFS services today are reimbursed at rates below their CMS-calculated direct costs.

“In sum, we urge Congress to build on the PFS downpayment in the House Budget Reconciliation package by recognizing the value of the lowest-cost, office-based setting and providing needed additional relief both for the conversion factor and PFS practice expenses of office-based providers.”

(1) The reconciliation bill provides for a 2026 conversion factor increase of 75% of MEI which is estimated by MedPAC to be around 2.3% per year from 2025 through 2023.